Reforms to make it simpler for care homes and hospitals to hold vulnerable people who cannot consent to treatment or care have cleared their first Commons hurdle – despite cross-party opposition and concern.

Ministers were warned that the measures in the Mental Capacity (Amendment) Bill could “potentially give private companies the power to lock up vulnerable people for years at a time”.

The Bill, which was also criticised in the House of Lords, aims to reform the process in the Mental Capacity Act 2005 for authorising arrangements enabling the care or treatment of people who lack the capacity to consent to proceedings themselves.

The new regime created by the Bill would replace the existing authorisation process, known as Deprivation of Liberty Safeguards (DoLS), which were introduced in 2009.

Those arrangements have attracted significant criticism for being too complex and bureaucratic, but provisions in this Bill have been described as “deeply flawed”.

Shadow mental health and social care minister Barbara Keeley (pictured) argued the Government’s proposed legislation was being “rushed through” adding that Labour could not support the Bill in its current form because “quite simply it proposes to replace one deeply flawed system for another”.

Ms Keeley claimed the Government was “more interested in cost saving than in the best interests of cared for people” as she called for the Bill to be paused.

She said: “Depriving some of the most vulnerable people in this country of their liberty should be an issue treated with the upmost respect, thought and care. However I’m afraid that the Government’s approach to this immensely important issue has shown few of these qualities.

“Reform of this act requires methodical planning, but the truth of this matter is that this Bill has been rushed through without proper scrutiny, despite the best efforts of many people concerned about its contents who have been working to change it for the better.”

Ms Keeley added: “It cannot be right that this Bill potentially gives private companies the power to lock up vulnerable people for years at a time to feed a lucrative and expanding private health sector.”

Tory former health minister Dr Daniel Poulter (Central Suffolk and North Ipswich) also called for a pause, adding: “Potentially under this Bill there will be less safeguards and less opportunity for people to review or appeal than there is actually under the Mental Health Act when someone is sectioned, and that’s something I believe she has a point about looking into and more broadly how this Mental Capacity Act sits alongside the Mental Health Act…I wonder if she would agree with me that a pause would be helpful.”

Liberal Democrat MP Norman Lamb, a former health minister, later said the Bill had been dubbed “one of the worst pieces of legislation ever to appear” and was still “highly deficient”.

The North Norfolk MP said: “That’s not a ringing endorsement of this legislation.

“That’s why it is critically important the Government does what it says it will do and that is collaborate to improve it because improvements are absolutely necessary.”

Health Secretary Matt Hancock urged all MPs to back the Bill saying the “current system is broken and needs to change”.

He said: “The current situation is this though; currently two million people in this country have impaired mental capacity. Care homes and hospitals often have to make decisions to restrict people’s movements to protect them.”

He said of the claim the Bill has been “rushed”, that it “follows the Law Commission spending three years developing the new model, consulting extensively, then a joint committee on human rights conducting an inquiry in pre-legislative scrutiny”.

“We need to get this bill on the statute book because every extra delay risks depriving someone of their liberty unnecessarily and I don’t want to see that happen,” added the Health Secretary.

He said of the issues of conflict of interest in making decisions on a patient’s liberty, rulings would not be done by “somebody who delivers day to day care” of that individual, and amendments would be laid down to make sure an external mental health professional oversaw decisions at independent hospitals.

The Bill passed its second reading unopposed and will return to the Commons for further scrutiny at committee stage.